What affects my credit score?

How your credit score is influenced by your spending habits

Credit scores are affected by many things

The obvious factors that come into consideration by credit scoring companies are: failing to pay your bills (or paying them late), not paying off your credit card every month or not meeting loan repayments.

The less obvious factors which can influence your credit score are: applying for too many loans or credit cards in a short space of time (even if you regularly pay them off on time), your name being on your partner’s loans if they default or evidence of you being a bad tenant.

Why else might I have a bad credit score?

Another factor which directly affects your credit score is your age. A credit score needs to be built up, so if young adults have a credit score, they don’t tend to be very high.

Or, if you haven’t applied for as much credit as the average Kiwi, you probably won’t have a very high score, simply because you’ve had less chances to prove you are a good payer. See our how to improve my credit score page to find out how getting more data under your name may improve your score.

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More credit scoring FAQs

A credit score is a number assigned to people by complex algorithms. When a credit check is requested, these algorithms can search through massive databases and analyse your historical credit data to see how likely you are to make regular payments in the future. The higher the score, the better your credit rating is. Read more about credit scores and who calculates them.

Not all credit scores are measured on the same scale. Our credit scoring provider, Centrix, uses a scale of 0-1500. However, a scale of 0-1000 is most common. In this case, scores well below 450 can be considered “bad scores”, scores above 600 can be considered “good scores” and anything in-between is the norm. Find out how you’re affected by a good or bad credit score.

Your credit report is the more comprehensive list of what historical data is feeding into your credit score. This includes any accounts, enquiries, defaults, infringements, collection notices, judgements, insolvencies and other public record information.

There are three credit reporting bureaus in NZ, some of them offer instant credit scoring and reporting online for free. You can request a free report from any of them if you’d like to find out more about your credit history.